Can I Bring a Bad Faith Insurance Claim in Michigan?
No: Michigan law does not recognize first-party bad-faith insurance claimsBy Marilyn Stone | Reviewed by Canaan Suitt, J.D. | Last updated on October 26, 2023 Featuring practical insights from contributing attorneys Michael H. Fabian, Mark L. Dailey and Charles W. Browning
Use these links to jump to different sections:
- Michigan Exempts Insurance Providers from First-Party Causes of Action
- You Have to Pay Your Own Attorneys’ Fees
- Timelines to Respomd to an Insurance Claim
- How Often Do Bad Faith Claims Arise?
- Find an Experienced Michigan Lawyer
Few states beat Michigan when it comes to available homeowners insurance, but the industry may not be a source of pride for the Great Lakes state.
Michigan Exempts Insurance Providers from First-Party Causes of Action
“Michigan is one of the few states where you can’t sue an insurance company for bad faith. Michigan has exempted insurance companies from the Consumer Protection Act (CPA),” says Michael Fabian of Fabian, Sklar, King & Liss in Farmington Hills, a firm specializing in property damage claims. Fabian is the editor of Michigan Insurance Law and Practice.
You Have to Pay Your Own Attorneys’ Fees
The CPA exemption also means that a homeowner or policyholder who takes an insurance company to court for wrongfully denying a claim or for not paying in a timely manner pays their own attorney fees—even if they win, Fabian says.
Timelines to Respomd to an Insurance Claim
Mark Dailey of Akeel & Valentine in Troy, with more than 23 years of experience in property insurance, explains the importance of timeliness.
“Michigan law provides that an insurance company must respond to satisfactory proof of loss within 30 days,” he says, but adds that the company often denies receiving satisfactory proof.
How Often Do Bad Faith Claims Arise?
Charles Browning, an attorney at Plunkett Cooney in Bloomfield Hills who has represented insurance companies for 24 years, says insurance companies give homeowners the benefit of the doubt on lost household goods—even if all records have been destroyed in the catastrophe.
“I think if you asked 100 homeowners if they are happy with the result of their claim, most will say ‘yes,’” he says.
Maybe you should ask your neighbors if they feel their property is in safe hands with their insurance policy.
Find an Experienced Michigan Lawyer
If you have questions about an insurance claim, suspect bad faith tactics on the part of an insurance provider, or think there’s been a breach of an insurance contract, seek out a reputable attorney to consider your case.
An experienced lawyer will be able to discuss if there are other tort actions beyond traditional first-party bad-faith claims for recovery.
For more information on this area, see our insurance coverage law overview.
Find top lawyers with confidence
The Super Lawyers patented selection process is peer influenced and research driven, selecting the top 5% of attorneys to the Super Lawyers lists each year. We know lawyers and make it easy to connect with them.Find a lawyer near you